## Financial ratio formulae

Often times we struggle to analyze a company’s performance and get lost into the detail of the annual reports and financial statements. Here are some ratios which can quickly help us assess the health of a company. Hope you find these useful in your analysis of financial statements! Liquidity Ratio 1.Current Ratio = Current Asset / Current Liabilities 2.Quick Ratio = (Current Asset – Inventory)/ Current Liabilities 3.Net working capital to sales ratio = Current Asset – Current Liabilities/ Sales Profitability Ratio 1.Gross Profit Margin [...]